A place for a tired old woman to try to figure things out so that the world makes a bit of sense.

Thursday, August 12, 2010

Bought And Paid For

Yesterday I posted on the sweet gigs the CEOs of some of the largest health insurers have managed. Noam Levey, who wrote the Los Angeles Times article my post was based on has another article up today on health insurers and how they operate.

Regulating health insurance premiums is still left up to the states even under the new and marvelous Health Care Reform Act. That's another battle we lost, although it wasn't much of a battle. It was one of those predetermined issues, like that of a single payer system or even a public option, both of which were never really on the table. As a result, insurance companies can essentially charge whatever they want for health insurance in most states because insurance commissioners have no authority to challenge the rates.

As Americans struggle with double-digit hikes in their health insurance bills, millions are coming up against a hard reality: The state regulators who are supposed to protect them can often do little to control what insurers are charging.

In many states, it is the insurance industry that largely controls the regulatory process, funneling money to key state lawmakers and squelching efforts to expand government oversight of premiums, a review of state regulations and campaign donations shows. ...

Since 2003, insurance companies and health maintenance organizations have given more than $42 million in state-level campaign contributions, often targeting lawmakers who sit on the committees that decide how much power regulators will have, according to campaign finance data analyzed by the Tribune Washington bureau and the National Institute on Money in State Politics. [Emphasis added]

The key to controlling the unconscionable rate hikes many of us have seen in the past two years (and can count on for the foreseeable future)would involve giving state insurance regulators "prior approval" authority, that is, the authority to approve or deny premium hikes before they actually take effect. In states such as Oregon, which has prior approval authority, 20 out of 71 proposed hikes were blocked. Unfortunately, only 19 states give their regulators such authority. In states like California, bills to give the insurance commissions this basic tool never get out of committee because those committee members are in the industry's hip pocket, bought and paid for.

The new Health Care law requires that everyone buy health insurance. It does not require that the health insurance be affordable. That was left to the states. I foresee a problem here, and I am not much of a visionary.